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FINALTERM EXAMINATION
Spring 2010
MGT211- Introduction To Business (Session - 3)
Time: 90 min
Marks: 69
Student Info
StudentID:
Center:
OPKST
ExamDate:
0 Aug 2010
For Teacher's Use Only
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Total
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Note :
Question No: 1
( Marks: 1 )
- Please choose one
Which
of the following is/are the component/s of business?
► Industry
► Commerce
► Both industry and commerce
► Trade and aids to trade
Ans1) trade and aid to trade
Question No: 2
( Marks: 1 )
- Please choose one
The notice calling the annual general meeting must be given to all its members at least _______________
days before the date of the meeting.
► 21 days
► 30 days
► 45 days
► 51 days
Ans 2) 21 days
Question No: 3 ( Marks: 1 ) - Please choose one
The portion of capital kept at the winding up of a company for the payment of debts is known as:
► Reserve capital
► Issued capital
► Subscribed capital
► Authorized capital
Ans3)
Question No: 4 ( Marks: 1 )
- Please choose one
Which
of the following statements is false?
► Franchising is very common.
► A franchise enables one to use a larger company's trade name.
► A franchisee never has to pay the franchiser a percentage of sales revenues.
► A franchise may constrain the franchisee's independence.
Question No: 5
( Marks: 1 )
- Please choose one
Business success can be attributed to:
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► Luck.
► Hard work, drive and dedication.
► A high demand for the good or service produced.
► All of the given options
Ans 5) All of the given options
Question No: 6
( Marks: 1 )
- Please choose one
A concept that implies that the firm should consider issues such as protecting the consumer, paying
fair wages, maintaining fair hiring practices, supporting education, and considering environmental
issues is:
► Financial management
► Profit maximization
► Social responsibility
► Agency theory
Question No: 7
( Marks: 1 )
- Please choose one
The
MBTI is a personality test that has been used to select candidates who will more likely engage in
organizational citizenship behaviors at work. However, critics of this test suggest that the results can
change over time as a person's personality develops. Therefore the MBTI personality test may be:
► Legal but not valid
► Valid but not reliable
► Reliable but not valid
► Reliable but not legal
Question No: 8 ( Marks: 1 ) - Please choose one
__________ is the process used by organizations to attract a qualified pool of job applicants.
► Socialization
► Human resource planning
► Recruitment
► Affirmation action
Question No: 9
( Marks: 1 )
- Please choose one
Profit
sharing, gain sharing and pay-for-knowledge plans are examples of:
► Individual incentives
► Company-wide incentives
► Cafeteria benefit plans
► Merit salary systems
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Question No: 10
( Marks: 1 )
- Please choose one
Which
of the following statements is NOT true about services?
► They are experienced, used or consumed.
► They are often sold first, then consumed.
► They are perishable.
► They are tangible.
Question No: 11
( Marks: 1 )
- Please choose one
Possession utility is provided when:
► A good or service is obtained and there is a right to use or consume it.
► A product is available where someone wants it.
► Someone performs a task for someone else
► Someone produces something tangible
Question No: 12
( Marks: 1 )
- Please choose one
___________ includes all of the activities managers engage in to forecast their current and future
human resource needs.
► RRecruitment and selection
► Job analysis and job design
► Selection and job design
► Human resource planning
Question No: 13
( Marks: 1 )
- Please choose one
Specifications of a product relate to the:
► Physical characteristics and level of quality
► Types of service that are provided along with the product
► Financing available with the product
► Types of competitors offering a similar product
Question No: 14
( Marks: 1 )
- Please choose one
Communicating information between sellers and potential buyers or others in the channel to
influence attitudes and behavior is called _________________.
► Advertising
► Promotion
► Publicity
► Marketing
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Question No: 15
( Marks: 1 )
- Please choose one
A
product can be:
► Tangible
► Intangible
► Something that is offered for sale
► All of the given options
Ans ) All of the given options
Question No: 16
( Marks: 1 )
- Please choose one
Consumer goods are classified as convenience, shopping, and:
► Durable.
► Nondurable.
► Consumer.
► Specialty.
Question No: 17
( Marks: 1 )
- Please choose one
The
stage of the Product life cycle where competitors appear is:
► Introduction
► Decline
► Maturity
► Growth
Question No: 18
( Marks: 1 )
- Please choose one
Expectations that specify the role of price in a firm's marketing and strategic plans are:
► Pricing considerations
► Pricing guidelines
► pricing objectives
► Pricing policies
Question No: 19
( Marks: 1 )
- Please choose one
Setting
the highest initial price is called price:
► Penetration
► Gouging
► Parity
► Skimming
Question No: 20 ( Marks: 1 )
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- Please choose one
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Which
type of sales promotion is used when a manufacturer places one small bottle of shampoo in a clear
bag and hangs it from the door of each house in a neighborhood?
► A sample
► A deal
► A premium
► An introductory offer
Question No: 21
( Marks: 1 )
- Please choose one
The
activities and processes used in making both tangible and intangible products is known as
_____________.
► Operations.
► None of the given options
► Making
► Production.
Question No: 22
( Marks: 1 )
- Please choose one
Under
which cost flow assumption is the ending inventory composed of the earliest purchased
merchandise?
► FIFO
► LIFO
► Average cost
► Specific identification
Question No: 23
( Marks: 1 )
- Please choose one
The
preferred method for achieving total quality in process output is to:
► Rely on a team of highly trained and dedicated inspectors.
► Rely on operator self-inspection and self-correction.
► Build and install an error-proof process and maintain it.
► Perform inspection at the next process.
Question No: 24
( Marks: 1 ) - Please choose one
What is
data?
► All of the facts that are collected, stored, and processed by an information system.
► All of the debit and credit information about each transaction.
► The same thing as information.
► All of the given options.
Question No: 25 ( Marks: 1 )
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- Please choose one
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Which
of the following is defined as large scale information system used for organizing and managing a
firm’s processes across product lines, departments and geographic locations?
► Expert System
► Decision Support System
► Enterprise Resource Planning
► Electronic Data Interchange
Question No: 26
( Marks: 1 )
- Please choose one
The
financial statement which shows cash activity (receipts and disbursements) during the accounting
period is called a(n):
► Bank statement.
► Income statement.
► Statement of cash flows.
► Bank reconciliation.
Question No: 27
( Marks: 1 )
- Please choose one
Which
of the following regarding GAAP is true?
► GAAP is the body of accounting knowledge followed by all countries in the world.
► GAAP is the abbreviation for generally accepted auditing procedures.
► Changes to GAAP must be approved by the Senate Finance Commission.
► All of the given options.
Question No: 28
( Marks: 1 ) - Please choose one
The
inventory cost flow assumption where the oldest cost of inventory items is likely to remain on the
balance sheet is______________
► All of the given options.
► FIFO
► LIFO
► Average
Question No: 29
( Marks: 1 )
- Please choose one
Which
of the following would generally have unlimited liability?
► A limited partner in a partnership
► A shareholder in a corporation
► The owner of a sole proprietorship
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► A member in a limited liability company (LLC)
Question No: 30
( Marks: 1 )
- Please choose one
The
situation when a country imports more than its exports is:
► A trade surplus.
► A recession.
► A trade deficit.
► An expansion.
Question No: 31
( Marks: 1 ) - Please choose one
The
marketing environment is BEST described as being
► Composed of controllable variables.
► Composed of variables independent of one another.
► An indirect influence on marketing activity.
► Dynamic and changing.
Question No: 32
( Marks: 1 )
- Please choose one
Which
one of the following statements by a company chairman best reflects the marketing concept?
► We believe that the marketing department must organise to sell what we produce.
► We try to produce only high quality, technically efficient products.
► We try to encourage company growth.
► We have organised our business to make certain that we satisfy customer needs.
Question No: 33
( Marks: 1 )
- Please choose one
When
Nayer Carpets develops new carpets that are highly stain resistant and durable, it must educate
consumers about the product's benefits. This calls for activity in which of the following marketing
mix variables?
► Price
► Promotion
► Product
► Packaging
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Question No: 34
( Marks: 1 )
- Please choose one
The
three major categories of influences that are believed to influence the consumer buying decision
process are personal, psychological, and:
► Person-specific
► Social
► Demographic
► Situational
Question No: 35
( Marks: 1 )
- Please choose one
Nestle
yoghurt represents which type of product for most consumers?
► Convenience
► Shopping
► Speciality
► Unsought
Question No: 36
( Marks: 1 )
- Please choose one
As the
production manager of an engineering firm, you went out and bought a metal cutting machine. What
you have purchased can best be classified as
► a processed component.
► a component part.
► raw material.
► an industrial product.
Question No: 37
( Marks: 1 )
- Please choose one
Physical distribution functions influence
► primarily pricing and product decisions.
► primarily promotion and pricing decisions.
► all elements of the marketing mix.
► primarily pricing decisions.
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Question No: 38
( Marks: 1 )
- Please choose one
All
elements of the marketing mix are influenced by physical distribution functions. For this reason, it is
important for marketers to remember that
► physical distribution decisions must be made prior to any other marketing strategy
consideration.
► physical distribution costs often rise as customer service requirements decrease.
► over 75 percent of all marketing costs are associated with physical distribution expenditures.
► no single distribution system is ideal for all situations and target markets.
Question No: 39
( Marks: 1 )
- Please choose one
A fruit
and vegetable wholesaler buys a loaded truck of strawberries from a local farmer and then
divides them into 10 kg baskets to sell to grocery stores. This sorting function is called:
► Allocation.
► assorting.
► accumulation.
► sorting out.
Question No: 40
( Marks: 1 )
- Please choose one
A
product's ability that it cannot be used for various purposes in different capacities and
under different conditions is termed as__________
► Flexibility of a product
► Inflexibility of a product
► Availability of a product
► All of the given options
Question No: 41
( Marks: 1 )
- Please choose one
Which
of the following statements is most suitable for Quality assurance?
► It refers to the prevention of product defects
► It is an auditing function that provides feedback to the project team and client about
the quality of output being produced
► It is the technical process that includes the construction of control charts
► None of the given options
Question No: 42
( Marks: 1 )
- Please choose one
Which
of the following is considered as the pillar of quality?
► Quality is free
► Doing it right the first time
► Process improvement
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► None of the given options
Question No: 43
( Marks: 1 )
- Please choose one
A
person needs to buy a medicine in midnight and gets it from a pharmacy, the availability of
medicine in the midnight represents following
► Time utility
► Form utility
► Place utility
► None of the given options
Question No: 44
( Marks: 1 )
- Please choose one
Flow of
communication from top to bottom is known as_______
► Downward communication
► Upward communication
► Combination of Downward and upward communication
► None of the given options
Question No: 45
( Marks: 1 )
- Please choose one
Auditors who are working within the organization are known as_______
► Internal auditors
► External auditors
► Both internal auditors and external auditors
► None of the given options
Question No: 46
( Marks: 1 )
- Please choose one
Assets
which can not be physically touched are termed as___________
► Intangible assets
► Tangible assets
► Good will
► None of the given options
Ans 46) Intangible assets
Question No: 47
( Marks: 1 )
- Please choose one
Profit
and loss account is also termed as ___________
► Income statement
► Balance sheet
► Trial Balance
► None of the given options
Question No: 48
( Marks: 1 )
- Please choose one
A plan
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or an estimate for future expenses and revenues is termed as_________
► Budgeting
► Balance sheet
► Income statement
► None of the given options
Question No: 49
( Marks: 3 )
Explain the nature and general purpose of financial statements.
Ans 49) statement prepared to meet the needs of all financial statement users as
opposed to meeting the needs of only a particular group such as investors, creditors,
management, or regulatory bodies. This is the purpose of financial statements based
on GAAP. Financial statements are written records of business finances, including
balance sheets and profit and loss statements. They stand as one of the most essential
components of business information, and as the principal method of communicating
financial information about an entity to outside parties. In a technical sense, financial
statements are a summation of the financial position of an entity at a given point in
time. General purpose financial statements are designed to meet the needs of many
diverse users, particularly present and potential owners and creditors. Financial
statements result from simplifying, condensing, and aggregating masses of data
obtained primarily from a company's (or individual's) accounting system
Question No: 50
( Marks: 3 )
What
is meant by the term ‘Just-in-Time’ Inventory system?
Ans 50) Pull driven inventory system in which materials, parts, sub-assemblies, and
support items are delivered just when needed and neither sooner nor later. Its
objective is to eliminate product inventories from the supply. As much a managerial
philosophy as an inventory system, JIT encompasses all activities required to make a
final product from design engineering onwards to the last manufacturing operation.
JIT systems are fundamentals to time based competition and rely on waste reduction,
process simplification, setup time and batch size reduction, parallel processing, and
shop floor layout redesign. Under JIT management, shipments are made within rigidly
enforced 'time windows’ and all items must be within the specification with very little
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or no inspection. It was developed and perfected by Taiichi Ohno of Toyota
corporation during 1960s.
Question No: 51
( Marks: 5 )
Differentiate between push and pull strategies for promotion.
Ans 51) A push strategy is when a company proactively and aggressively markets or
promotes a product or product line to the market place or a market segment. This can
be through cold calling, direct mail, sending email blasts, advertising, etc. in which
the company explicitly asks a prospective consumer to take action such as:
"Buy Now!" "Call Today" Sign Up Now" "For More Info Visit..."
Some times push strategy is accompanied by a sense of urgency and limited time
offers and one-time incentives to prompt consumers' immediate action.
On the other hand a pull strategy is more passive than aggressive. In this case
companies may have longer term strategy in mind. A company may look to instill top
of mind awareness in the marketplace or build its Brand equity. Another twist to pull
offers, is FREE Offers, this is when prospects are offered free trials, free information
passively. The purpose behind this is to generate leads to which marketers can later
promote back-end offers, in fact sometimes marketers will lose money upfront
because they know they'll make up their money in the back-end. Good examples are:
Coke Commercials (Enjoy Coca, Polar, Polar Bears) Lexus Commercials, Free Offers
on the internet or ON TV.
To summarize a push strategy is aggressive, direct and calls prospects to action. A
pull strategy is passive, instills a message for top of mind awareness or to build Brand
equity.
Question No: 52
( Marks: 5 )
Define
the term “Material Management”. What are the problems faced by materials
managers in today’s world?
Ans 52) Material Management is concerned with control of materials in such a
manner which ensures maximum return on working control. Material management is
concerned with the location & purchase of needed their storage & movement. It also
arranges to keep an account for them. It is also responsible for planning their
movement through manufacturing processes, store rooms and distribution channels. It
is the branch of logistics that deals with the tangible components of a supply chain
which covers the acquisition of spare parts/replacements, quality control of
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purchasing and ordering such parts/replacements, and the standards involved in
ordering, shipping, and warehousing.
Question No: 53
( Marks: 5 )
Define
channel of communication, discuss different types of channels of business
communication.
Ans 53) Various sources used by marketers to send marketing messages to potential
consumers. Communication channels may be personal, involving two or more persons
communicating directly with each other, such as a customer/salesperson relationship,
or impersonal such as bill boards etc.
Types of communications:

Verbal Communication
Verbal communication is further divided into written and oral communication.
The oral communication refers to the spoken words in the communication
process. Oral communication can either be face-to-face communication or a
conversation over the phone or on the voice chat over the Internet. Spoken
conversations or dialogs are influenced by voice modulation, pitch, volume and
even the speed and clarity of speaking. The other type of verbal communication is
written communication. Written communication can be either via snail mail, or
email. The effectiveness of written communication depends on the style of
writing, vocabulary used, grammar, clarity and precision of language.

Nonverbal Communication
Non-verbal communication includes the overall body language of the person who
is speaking, which will include the body posture, the hand gestures, and overall
body movements. The facial expressions also play a major role while
communication since the expressions on a person’s face say a lot about his/her
mood. On the other hand gestures like a handshake, a smile or a hug can
independently convey emotions. Non verbal communication can also be in the
form of pictorial representations, signboards, or even photographs
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